California Cannabis Unions

The passage of California’s Senate Bill 643 established a comprehensive licensing and regulatory framework for the cultivation, manufacture, transportation, storage, distribution, and sale of medical cannabis. The new law provides that all state commercial cannabis applicants or licensees with 20 employees or more (not counting some management) must operate under a Labor Peace Agreement (“LPA”). This requirement includes all types of license classifications (cultivation, manufacturing, testing, dispensary, distributor, transporter), with limited exceptions.

An LPA is an agreement between the employer and a bona fide labor union. While SB 643 did not define a “bona fide” union, California’s regulations provide a definition, and employers should ensure compliance when engaging with an organization that purports to represent employees.

Additionally, under the law, a union cannot strike or use work stoppages while negotiating or organizing, but an employer cannot disrupt efforts by the union to communicate with, organize, and represent employees.

All employers should know, however, that cannabis remains a Schedule I drug according to the federal Controlled Substances Act. Activity related to cannabis use is subject to federal prosecution, regardless of protections provided by California law.